Australian Government

Credit Reporting Reform: What It Means

Last updated on March 15th, 2018 at 01:05 pm

From 12th March this year (2014), the credit reporting agencies that provide banks and other lending bodies with information on the financial background of people who are wanting to take out a loan, will be allowed to collect more information than they do currently. This change is known as the credit reporting reform.

This is potentially good and bad news for consumers, depending on their lending history. In particular, the agencies will be able to access how applicants have (or have not) been able to repay loans, which would include paying bills and paying off credit cards. The rule changes in fact bring Australia into line with standard practice in many other countries, and the idea is that banks and financial institutions will be able to make better decisions in terms of who they lend to if they have more information.

At present the credit agencies only hold and provide information on major negative events, such as bankruptcy, court judgments and payment defaults. Under the new system, agencies will be able to share more information, such as overall history of repayment of a loan or debt, when a credit card or loan was taken out and any limits that apply to the card or facility.

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So where an individual has for example had a bad period in the past, but has subsequently been able to pay bills, credit cards etc on time, this will compensate for what under the old system would have been just a black mark and nothing to show for an improved credit history.

The downside is that access to payment history will also show up habitual late or missed payments that under the old system would not show up, as long as there wasn’t a default or other major negative factor.

The new regime is designed to allow banks and other lenders to make decisions more quickly by giving them access to more – and more relevant – information on the prospective borrower.

With one of the major credit reporting agencies reporting a negative credit history in 15% of their 16 million records, according to the old rules, now is a good time to make sure all bills are paid on time, and mortgages and credit card payments are kept up-to-date if you’re planning on applying for finance after March this year.

Negative credit history factors remain on your credit rating for five years and they will count against you in any finance application. Under the new rules, even though they’re more intrusive, a cleaner more recent credit history will work in your favour.


To check your credit history, go to:

And for more advice on what you can do to improve your chances of getting that loan, check our other article here:

Why you should avoid a busy recent credit history

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